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City turns into hub for flight refuelling
Posted by Srini Uppala | May 11, 2008 | 326 views
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Loading ...Hyderabad has become a major hub for refuelling of aircraft thanks to the cut in sales tax on aviation turbine fuel. The number of aircraft refuelling in Hyderabad has doubled from 60 to 120 in just two months following the government’s move to reduce sales tax on ATF from 33 per cent to 4 per cent.
ATF costs around Rs 48,000 per kilolitre in Hyderabad and Rs 60,000 per kilolitre in cities like Mumbai and Delhi. Sales tax on ATF ranges from 20 to 35 per cent in other states. ATF intake by airlines at the Shamshabad airport has also doubled from 550 kilolitres to 1,100 kilolitres per day.
Airlines save around Rs 2.8 lakh per A-320 aircraft, which have a 24-kilolitre intake capacity, by refuelling at Hyderabad. Several airlines are opting for overnight parking and flight origination from Hyderabad. “The decision taken by government to reduce sales tax from 33 to 4 per cent is a huge advantage for all the airlines. Airlines now save around 10 per cent on fuel costs,” said Mr A. Viswanath, GMR Hyderabad International Airport Ltd vice-president (corporate planning and risk management).
The Chief Minister, Dr Y.S. Rajasekhar Reddy, reduced sales tax on ATF two months ago on the eve of the inauguration of the new airport. The ministry of civil aviation had made a plea to state governments to reduce the sales tax on ATF to 12.5 per cent.
The open access system for fuel introduced at the new airport has helped reduce ATF prices further. Earlier, only one oil company maintained the fuel supply and decided the price. Airlines were forced to depend on the oil company though cost of fuel was exorbitant. All the oil companies now store ATF in a single fuel complex and sell them to airlines with which they have agreements. With the competition under the open access system, the oil firms are cutting ATF prices to attract airlines.
SOURCES:
Deccan Chronicle
Topics: Airports, Govt In Action |
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